What caused the national debt?

[Toddsterpatriot]

Does the article mention the Trillions in Banker bailouts for the Derivatives they made? Hint: 1,500 Trillion.

The bank bailouts have been repaid, at a profit to the Treasury.

Does anyone knows what happened with the money after it was returned to the treasury?
If they spend it on something else, then it goes on deficit, right?

I think Obama spent it.
So Bush's TARP loans were charged to his deficit and when it was paid back, it reduced Obama's deficit.

 

[Mr. Shaman]

Higher spending than revenues, as a habit.

Duh.

Bushenomics!!!!

DUH!!
​

 

[Ame®icano]

That would be the December 2007 recession that started January 20, 2009 at 12:00 PM EST. It was in all the papers.

Actually, on January 20, 2009, most rational Americans found themselves start of a massive depression that hasn't let up yet ... for some reason.

There is plenty of money in the country.

It's just concentrated in too few hands.

There is $2 trillion dollars parked in treasuries.

Typical commie.

 

[Ame®icano]

The solution is pretty simple.

We need to repeal the Bush tax cuts and cut spending.

The Republicans want to use this to kill Social Security and Medicare

Programs some of us have paid into for 40 years.

Good luck with that Republicans. Americans will remember who tried to kill Social Security and Medicare in 2012.

Sure, dead will vote again...

 

[Too Tall]

There were a lot of Democrats who voted for those budgets. You know, back when we actually made budgets. Presidents do not authorize expenditures. Not even close.

With a lot od dem help.

But to continue your education you must visit this site.


Government - Historical Debt Outstanding – Annual

I dont care how your politics swing. Dont be a liar.

I went back and examined the votes during the Reagan administration and it was all the Republicans and a few Dixiecrats that passed his budgets.

And Bush had a Republican House until 2006.

But thanks again for playing.

The Democrats controlled the House from 1955 until 1995 and all spending bills start in the House. How did the Republicans pass ANY Reagan budget?

 

[editec]

That's not true.

Clinton balanced the budget by increasing taxes for the rich and cutting the defense budget.

No, actually he buried the deficet he did not balance the budget...

Clinton’s large budget surpluses also owe much to the Social Security tax on payrolls. Social Security taxes now bring in more than the cost of current benefits, and the "Social Security surplus" makes the total deficit or surplus figures look better than they would if Social Security wasn’t counted. But even if we remove Social Security from the equation, there was a surplus of $1.9 billion in fiscal 1999 and $86.4 billion in fiscal 2000. So any way you count it, the federal budget was balanced and the deficit was erased, if only for a while.

The Budget and Deficit Under Clinton | FactCheck.org

Are you sure about that?

I'm not.

Social security lends the FED money ergo it its contribution to the annual cash flow is counted as debt, not tax revenue.

Note that the SS debt is part of the overall FED's national debt?

 

[Ame®icano]

The National Debt was caused by Reagan and the two Bushes cutting taxes for the rich.

Go here to see the numbers... ReaganBushDebt.org

You said this four times (so far) in this thread.

 

[Toddsterpatriot]

The National Debt was caused by Reagan and Bush cutting taxes for the rich, Bush putting two wars and a Medicare drug program on his Chinese credit card, and Wall Street's $516 TRILLION DOLLAR Ponzi scheme which collapsed our economy.

How much did the Reagan and Bush tax cuts for the rich add to the national debt?
Spell it out.

 

[Mr. Jones]

Toddsterpatriot;3915770]You said all money is debt.
I proved you're wrong.

[quote Toddsterpatriot;3915770]"Banks get to create money out of thin air and only have to keep a fraction of the deposits from customers in reserve"

They loan a portion of deposits, they don't get to create money out of thin air.

"Our money is debt. In order for our money to exist it must be LENT to us and it has INTEREST attached to it"

My $20s don't have interest attached. Still waiting for your proof that they do.

"Every dollar in existence is a "bill" that must be paid back to its owner. We can only pay this bill back with more bills"

Wrong. I don't have to pay my $20 back to anyone. I'm the owner.

"You don't even know how the money in your wallet is created!"

Sure I do!
The Fed sends an order to the Bureau of Engraving and Printing.
Did you ever tell me who you rent your $20s from?

Your ignorance proves you are clueless..Money creation, and the debt that ensues with every note created is as follows-

The United States Government decides it needs some money, so it calls up the Federal Reserve, and requests, say, 10 billion dollars”. The fed replies, saying ” sure… we’ll buy 10 billion in government bonds from you.”
So, the government then takes some piece of paper, paints some official looking designs on them, and calls them ‘Treasury Bonds’. Then, it puts a value on these Bonds to the sum of 10 billion dollars, and sends them over to the Fed. In turn, the people at the Fed draw up a bunch of impressive pieces of paper themselves, only this time calling them ‘Federal Reserve Notes’…also designating a value of 10 billion dollars to the set.
The Fed then takes these notes and trades them for the Bonds. Once this exchange is complete, the government then takes the 10 billion in Federal Reserve Notes and deposits it into a bank account…and upon this deposit, the paper notes officially become ‘legal tender’ money, adding 10 billion to the US money supply. And there it is… 10 billion in new money has been created. Of course, this example is a generalization, for, in reality, this transaction would occur electronically, with no paper used at all. In fact only 3% of the US money supply exists in physical currency. The other 97% essentially exists in computers alone.

Now, Government bonds are, by design, instruments of Debt and when the Fed purchases these bonds, with money it created essentially out of thin air, the government is actually promising to pay back that money to the Fed.

In other words… The money was created out of debt. This mind numbing paradox of how money, or value, can be created out of debt, or a liability, will become more clear as we further this exercise.

So, the exchange has been made and now 10 billion dollars sits in a commercial bank account. Here is where it gets really interesting, for as based on the Fractional Reserve practice, that 10 billion dollar deposit instantly becomes part of the bank’s Reserves, just as all deposits do. And regarding reserve requirements, as stated in Modern money mechanics:
A bank must maintain legally required reserves, equal to a prescribed percentage of its deposits. It then quantifies this by stating: under current regulations, the reserve requirement against most transaction accounts is 10%.”

This means that with a ten billion dollar deposit, 10% or 1 billion is held as the required reserve, while the other 9 billion is considered an excessive reserve and can be used as the basis for new loans.

Now, it is logical to assume that this 9 billion is literally coming out of the existing 10 billion dollars deposit. However, this is actually not the case. What really happens is that the 9 billion is simply created out of thin air, on top of the existing 10 billion dollar deposit. This is how the money supply is expanded. As stated in Modern Money Mechanics: ”

http://www.rayservers.com/images/ModernMoneyMechanics.pdf

If I were to loan you $100, my assets would decrease $100. When a bank or other "lending" institution "lends" to you or anyone else, their assets actually increase!


of course, they (the banks) do not really pay out loans from the money they receive as deposits. If they did this, no additional money would be created. What they do when they make loans is to accept promissory notes (loan contracts) in exchange for credits (money) to the borrower’s transaction accounts.”
In other words, the 9 billion can be created out of nothing, simply because there is a demand for such a loan, and there is a 10 billion dollars deposit to satisfy the reserve requirements.
Now, let’s assume that somebody walks into this bank and borrows the available 9 billion dollars. They will then most likely take that money and deposit it into their own bank account.
The process then repeats, for that deposit becomes part of the banks reserves, 10% is isolated and in turn 90% of the 9 billion or 8.1 billion is now available as newly created money for more loans. And, of course, that 8.1 can be loaned out and redeposited creating an additional 7.2 billion…to 6.5 billion.. to 5.9 billion etc.

This means that with a ten billion dollar deposit, 10% or 1 billion is held as the required reserve, while the other 9 billion is considered an excessive reserve and can be used as the basis for new loans.
This deposit-money creation-loan cycle can technically go on to infinity…

...The Fractional Reserve System of monetary expansion is inherently
inflationary. For the act of expanding the money supply without there being a proportional expand of good and services in the economy, will always debase a currency..

....Every single dollar in your wallet is owed to somebody by somebody; for remember, the only way the money can come into existence is from loans. Therefore, if everyone in the country were able to pay off all debts, including the government, there would not be one dollar in circulation.

(If there were no debts in our money system, there wouldn't be any money”
-Marriner Eccles-Governor of the Federal Reserve
September 30th, 1941 -House Committee Hearing on Banking and Currency )

SWITCHBACK WORDS: transcript of Zeitgeist:Addendum

Your ignorance to the scam is a testament to how fiendishly brilliant it is, but does not absolve you of being a willfully ignorant blockhead who refuses to face facts.

 

[Toddsterpatriot]

Your ignorance proves you are clueless..Money creation, and the debt that ensues with every note created is as follows-

The United States Government decides it needs some money, so it calls up the Federal Reserve, and requests, say, 10 billion dollars”. The fed replies, saying ” sure… we’ll buy 10 billion in government bonds from you.”
So, the government then takes some piece of paper, paints some official looking designs on them, and calls them ‘Treasury Bonds’. Then, it puts a value on these Bonds to the sum of 10 billion dollars, and sends them over to the Fed. In turn, the people at the Fed draw up a bunch of impressive pieces of paper themselves, only this time calling them ‘Federal Reserve Notes’…also designating a value of 10 billion dollars to the set.
The Fed then takes these notes and trades them for the Bonds. Once this exchange is complete, the government then takes the 10 billion in Federal Reserve Notes and deposits it into a bank account…and upon this deposit, the paper notes officially become ‘legal tender’ money, adding 10 billion to the US money supply. And there it is… 10 billion in new money has been created. Of course, this example is a generalization, for, in reality, this transaction would occur electronically, with no paper used at all. In fact only 3% of the US money supply exists in physical currency. The other 97% essentially exists in computers alone.

Now, Government bonds are, by design, instruments of Debt and when the Fed purchases these bonds, with money it created essentially out of thin air, the government is actually promising to pay back that money to the Fed.

In other words… The money was created out of debt. This mind numbing paradox of how money, or value, can be created out of debt, or a liability, will become more clear as we further this exercise.

So, the exchange has been made and now 10 billion dollars sits in a commercial bank account. Here is where it gets really interesting, for as based on the Fractional Reserve practice, that 10 billion dollar deposit instantly becomes part of the bank’s Reserves, just as all deposits do. And regarding reserve requirements, as stated in Modern money mechanics:
A bank must maintain legally required reserves, equal to a prescribed percentage of its deposits. It then quantifies this by stating: under current regulations, the reserve requirement against most transaction accounts is 10%.”

This means that with a ten billion dollar deposit, 10% or 1 billion is held as the required reserve, while the other 9 billion is considered an excessive reserve and can be used as the basis for new loans.

Now, it is logical to assume that this 9 billion is literally coming out of the existing 10 billion dollars deposit. However, this is actually not the case. What really happens is that the 9 billion is simply created out of thin air, on top of the existing 10 billion dollar deposit. This is how the money supply is expanded. As stated in Modern Money Mechanics: ”

http://www.rayservers.com/images/ModernMoneyMechanics.pdf

If I were to loan you $100, my assets would decrease $100. When a bank or other "lending" institution "lends" to you or anyone else, their assets actually increase!


of course, they (the banks) do not really pay out loans from the money they receive as deposits. If they did this, no additional money would be created. What they do when they make loans is to accept promissory notes (loan contracts) in exchange for credits (money) to the borrower’s transaction accounts.”
In other words, the 9 billion can be created out of nothing, simply because there is a demand for such a loan, and there is a 10 billion dollars deposit to satisfy the reserve requirements.
Now, let’s assume that somebody walks into this bank and borrows the available 9 billion dollars. They will then most likely take that money and deposit it into their own bank account.
The process then repeats, for that deposit becomes part of the banks reserves, 10% is isolated and in turn 90% of the 9 billion or 8.1 billion is now available as newly created money for more loans. And, of course, that 8.1 can be loaned out and redeposited creating an additional 7.2 billion…to 6.5 billion.. to 5.9 billion etc.

This means that with a ten billion dollar deposit, 10% or 1 billion is held as the required reserve, while the other 9 billion is considered an excessive reserve and can be used as the basis for new loans.
This deposit-money creation-loan cycle can technically go on to infinity…

...The Fractional Reserve System of monetary expansion is inherently
inflationary. For the act of expanding the money supply without there being a proportional expand of good and services in the economy, will always debase a currency..

....Every single dollar in your wallet is owed to somebody by somebody; for remember, the only way the money can come into existence is from loans. Therefore, if everyone in the country were able to pay off all debts, including the government, there would not be one dollar in circulation.

(If there were no debts in our money system, there wouldn't be any money”
-Marriner Eccles-Governor of the Federal Reserve
September 30th, 1941 -House Committee Hearing on Banking and Currency )

SWITCHBACK WORDS: transcript of Zeitgeist:Addendum

Your ignorance to the scam is a testament to how fiendishly brilliant it is, but does not absolve you of being a willfully ignorant blockhead who refuses to face facts.

"The United States Government decides it needs some money, so it calls up the Federal Reserve"

Wrong. If the Treasury needs money they auction Treasury Bills, Notes or Bonds.
Primary Dealers bid on the offered debt. You can participate as well, although you can't put in your own bid.

"The fed replies, saying ” sure… we’ll buy 10 billion in government bonds from you.”"

Wrong again. If the Fed wants to buy Treasuries, they buy them from a Primary Dealer, not the Treasury.

"In turn, the people at the Fed draw up a bunch of impressive pieces of paper themselves, only this time calling them ‘Federal Reserve Notes’…"

Wrong again. When the Treasury sells bonds, they don't exchange them for FRNs.
The Treasury doesn't use FRNs.
They use checks and wire transfers.

"Now, Government bonds are, by design, instruments of Debt and when the Fed purchases these bonds, with money it created essentially out of thin air, the government is actually promising to pay back that money to the Fed"

Yes and when I buy Treasury bonds, the government is actually promising to pay back that money to me.

"So, the exchange has been made and now 10 billion dollars sits in a commercial bank account"

The Treasury doesn't hold their money in a commercial bank account.

"Here is where it gets really interesting, for as based on the Fractional Reserve practice, that 10 billion dollar deposit instantly becomes part of the bank’s Reserves"

It actually doesn't get interesting, the commercial bank doesn't hold the Treasury money.

"This means that with a ten billion dollar deposit, 10% or 1 billion is held as the required reserve, while the other 9 billion is considered an excessive reserve and can be used as the basis for new loans"

Excellent! Usually these conspiracy websites can't even get the math right.

"Now, it is logical to assume that this 9 billion is literally coming out of the existing 10 billion dollars deposit"

It's logical because that's how it works.

"What really happens is that the 9 billion is simply created out of thin air, on top of the existing 10 billion dollar deposit"

It's not created out of thin air, it's a portion of the deposit loaned back out.

"If I were to loan you $100, my assets would decrease $100"

Wrong. Your cash assets would decrease by $100, your loan assets (what I owe you) increases by $100. Net assets are unchanged.

"When a bank or other "lending" institution "lends" to you or anyone else, their assets actually increase"

Wrong again, their assets change form but the total amount does not.

"of course, they (the banks) do not really pay out loans from the money they receive as deposits"

But of course they pay out loans from money they received.

" If they did this, no additional money would be created"

They do that and yet additional money is created.

"....Every single dollar in your wallet is owed to somebody by somebody"

I own my $20. Who is the somebody you imagine it is owed to who is the somebody who owes?

"the only way the money can come into existence is from loans"

That's not the only way.

"Therefore, if everyone in the country were able to pay off all debts, including the government, there would not be one dollar in circulation"

Why would everybody want to pay off all loans in the country?

Remember what I told you before.
I don't mind correcting all your misperceptions, but please cut the BS into smaller portions.